Sunday, April 26, 2009
Japanese pension fund sells government bonds
Japanese pension fund becomes a seller of Japanese government bonds. I think this places pressure on the UK issuance in the future as the J. bond yield must go up to counter falling demand. The article points out that the UK is in a global market as a weak financial player, and international competition amongst governments to find buyers for gov. debt. Or yields will go up, and borrowing costs will rise. Perhaps the UK budget was really the point of no return as we are locked into excessive debt issuance with rising servicing costs. New Labours plan to compensate for a fall in the velocity of money by attempting to increase the quantity precludes any recovery. Hold onto your hats if you love low house prices (and unemployment boo..).